Rowland: Deal Illinois in on sports gambling, but prepare for diminishing returns

Brett Rowland Contributing columnist

Published
12:48 pm CDT, Friday, October 19, 2018

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Rowland: Deal Illinois in on sports gambling, but prepare for diminishing returns

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Lawmakers prepared to allow sports gambling in Illinois shouldn’t be expecting a jackpot that will solve the state’s fiscal crisis.

The opportunity has arisen for the state to open up legalized betting on sports. In May, the Supreme Court struck down federal prohibitions on sports gambling, opening the door for state-sanctioned sports betting across the country, not just in Nevada. Neighboring states are likely to get into the game, but Illinois can still get out in front of them.

Regardless of how you feel about gambling, it is well established here. In addition to the state lottery, Illinois has horse tracks and casinos. Video gambling is seemingly everywhere.

At this point, adding sports to the mix shouldn’t be controversial. Sports gambling is already happening here. It might as well be state-sanctioned to protect those who choose to play, so long as the politicians who write the law don’t play favorites.

So go for it. Set up a fair marketplace with clear rules and taxes. Establish reasonable limits. Bet on the New York Mets. Or the Cleveland Browns. Or the Washington Generals. But don’t expect a windfall. Expect diminishing returns.

Illinois’ Commission on Government Forecasting and Accountability told lawmakers at a hearing in May that adjusted gross receipts for the state’s casinos have declined annually for the past six years. Casino tax revenue has declined while video gambling revenues have increased.

COGFA has estimated that a plan that would add six casinos with 21,000 gaming positions while restructuring the casino tax structure would bring in another $12 million. That’s not going to make a dent in the state’s $8 billion pile of unpaid bills. Or its $130 billion in unfunded pension debt.

Sports gambling could bring in more than that $12 million. Not near enough to cover the spread.